CRH surges 4.9% as it enters talks to buy US firm

Dublin Report:CRH provided the main focus for investors in the Irish stock market yesterday as shares in the building materials group raced ahead by nearly 5 per cent.

The stock closed €1.18, or 4.9 per cent, higher at €25.29 after the company said it had entered into exclusive talks to buy US asphalt business Ashland Paving and Construction.

If successful, the deal would be CRH's largest acquisition ever and news of the talks helped soothe recent investor concern over the company's exposure to the slowing US residential construction market.

"It was well received by investors," noted one dealer. "It reminded them of the solid foundations of the business."

Elsewhere, trading was light as the Iseq finished 100 points, or 1.36 per cent, higher, although a weak start on Wall Street dampened sentiment in afternoon trade.

Dealers reported good volume in Anglo, which lost eight cent, to €11.20. In contrast, Irish Life & Permanent was up by 29 cent, or 1.6 per cent, to €18.29 ahead of its trading update later this week.

Bank of Ireland also gained 14 cent, or nearly 1 per cent, to €14.29 while AIB held broadly steady at €18.39.

Despite an upgrade from NCB, which raised its recommendation to "buy" from "add" and set a target of €41.70 for the shares, FBD drifted off by five cent to €35.30.

Other notable movers yesterday included Fyffes, which gained six cent, or 4.5 per cent, to €1.38. Elan firmed by 64 cent, or 5 per cent, to €13.29 in Dublin while Grafton was up by 20 cent to €9.70, a rise of 2 per cent. Kingspan was also firm as it gained 24 cent, or nearly 1.9 per cent, to €13.14.

Shares in Kerry Group added 25 cent, or 1.6 per cent, to €16.30 as Kerry Co-op cut its shareholding in the company to 27.7 per cent following the spin-out of 10 per cent of its stake to its members.

Paddy Power was another of the day's better performers, finishing 23 cent, or nearly 1.8 per cent, higher at €13.03.